It is deceptively simple, but effective - impersonate a CEO by "spoofing" his or her email and request W-2 information from human resources. Coming at the height of tax season, busy HR staff may not stop to question the true identity of the sender.
A warning this week from the Internal Revenue Service describes a new variant on an old scam. The typical one goes like this: an impersonator calls and claims to be from the IRS. Then says you owe back taxes and must immediately pay over the phone or the police will come arrest you.
You'd think tax refunds for early filers would have arrived by now. After all, it's been more than three months now since the IRS opened up the 2013 income tax filing season.
It's bad enough being contacted by the IRS about a potential audit or an ongoing investigation. But in some ways it's even worse when scammers and various bad online actors send bogus e-mails purporting to be from the IRS. These scammers attempt to use the IRS name - or even its logo - to trick people into revealing personal information.
The problem of tax-return fraud involving identity theft is so large that there are many different aspects to it. Last week, we wrote about the issue of how the IRS is responding to the challenge of processing returns without undue delays.
Identity theft that leads to tax refund fraud has been a significant problem for quite some time. The IRS says it is working on the issue. In our December 3 post we wrote about the agency's intention to use new software filters to do a better job at flagging fraudulent tax returns that are the product of identity theft.
Many people like to file their taxpayers early. The motivation may be to get a tax refund sooner. It may be simply be to get taxes taken care. It could be both.
When you are involved in a tax dispute with the IRS or your state revenue agency, it hardly seems like these tax authorities are on your side. Indeed, sometimes aggressive tax litigation is required to resolve the dispute.
Taxpayers in Southern California may dread receiving communications from the Internal Revenue Service because they often contain the announcement of an audit or a tax deficiency. But people here and around the country have a new reason to be wary of potential communications from the IRS: identity theft.
In the past few months, we have talked a few times about the rise in taxpayer identity theft that has been behind a growing wave of tax fraud across the country. While nearly everyone has acknowledged that this is a grave problem, a recently released report from the Treasury Inspector General for Tax Administration says that it could be much worse than people had first thought.